June 28, 2007, 12:00 AM

Web analytics can deliver the data, but vendors need to make use easier

Boosting conversion tops many retailers’ to-do lists, and analytics has emerged as a key tool.

Place a product on a store shelf and a marketer may wait an entire season for a true read on its sales performance. Put a product up in an online store and that intelligence will surface in a matter of days, maybe hours.

Compressing that timeframe online is web analytics, software and service technology that tracks online shoppers’ behavior from their point of entry into a retail web site all the way through purchase or exit. Data gleaned from analytics can tell a retailer which shopping engines or ad campaigns deliver the most customers, what and how much customers bought, what they looked at but didn’t buy, and much more.

It’s on the key metric of conversion-the percentage of site visitors who ultimately make a purchase-that web analytics has been earning its keep in retail. Boosting the rate of conversion tops the to-do list at virtually every online retailer, and analytics has emerged as a key tool for not only measuring but managing conversion rates. According to an Aberdeen Group cross-industry survey of online marketers of which retailers comprised 33% of the total, 69% of those surveyed use analytics to track conversion. While only 14% said they were satisfied with their current conversion rate, all of them said they viewed web analytics as a means of pushing it higher.

Conversion and objectives

That’s because conversion data is one way to measure a site’s performance against corporate sales objectives. But while the meaning of conversion statistics is widely understood by online retailers, web analytics can also track virtually every other aspect of a customer’s interaction with a site. That raises the specter of data overload.

And retailers may find that hard to figure out as they venture beyond the basics. A recent global survey, “Web Analytics Demystified,” by web analytics expert Eric T. Peterson, sponsored by the Web Analytics Association, found that of nearly 1,000 web analytics practitioners, consultants and end-users polled, 82% said analytics is poorly understood in their organization and the majority of people interacting with the data don’t understand what it means.

“Companies need to recognize that web analytics is not easy even for the most experienced users of the technology, and respond appropriately,” says Peterson in the study. For retail organizations and other users of analytics, that means stepping up education for web analytics professionals as well as for the business professionals seeking to build that analytics data into merchandising, advertising and other programs, he believes.

And for the vendors of web analytics tools and software, there is a charge in those findings as well: make the data easier to understand and use. In response, web analytics vendors are developing technology that helps web analytics users move beyond simply generating reports on summary data to answering specific business questions to set a course of action.

Like traditional marketing

“Web analytics has evolved from being about trying to glean insights from a mountain of clickstream data. Now it’s really more like traditional marketing activity-segmenting the prospect or customer base into high, medium and low prospects and customers,” says Steve O’Brien, vice president of sales and marketing in the Internet marketing solutions group at web analytics provider Unica Corp. That segmentation has been made possible in web analytics by the advent of site registration, the pervasiveness of cookies and the willingness of shoppers to provide personal information to receive some benefit, he adds.

To that segmentation capacity, Unica’s latest web analytics release adds a drag-and-drop interface enabling business users to generate complex queries, automatically populate a report with a segmented list of customers or prospects, and export it into any campaign management or customer relationship management system, O’Brien says.

“Web analytics is no longer about producing reports,” O’Brien adds. “It’s about actionable information and being able to get data out of your analytics package and into another application that takes action.

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